An assessment of financial and supply chain management outcomes in Western Cape public hospitals

Lewis, Hendrik Archie (2005-03)

Thesis (MPA (School of Public Management and Planning))--University of Stellenbosch, 2005.


South Africa, as a young and emerging democracy, faces many challenges regarding the transformation of the socio-economic landscape of the South African society. The provision of better health care services and the overall development and empowerment of society are some of the many challenges government has to resolve. This research focuses specifically on service delivery in public hospitals with special emphasis on: 􀂙 An assessment of financial management outcomes within the context of the implementation of the Public Finance Management Act (Act 1 of 1999, as amended) [PFMA] in public hospitals; and 􀂙 An assessment of supply chain management (SCM) outcomes in relation to the achievement of empowerment and equity of disadvantaged communities within the context of Black Economic Empowerment (BEE). The PFMA is the result of financial reform in South Africa. The PFMA emphasises effective, efficient, economic and transparent use of public funds. This research assessed the financial management at the Head Office of the Western Cape Health Department, as well as at Karl Bremer, Lentegeur and Swellendam Hospitals for the financial years 1998/99 to 2002/03. The Western Cape Tender Board ceased to exist in December 2003. The procurement and provisioning processes have now been decentralised to the various departments with effect 1 January 2004 and have become the responsibility of supply chain units within departments. BEE and the preferential procurement policy are government initiatives that had to be executed on SCM as platform. The three hospitals were also used to assess progress on the implementation of SCM, as well as the realisation of BEE objectives. Annual Reports, Audit Reports and Strategic Planning documentation were used to extract the relevant information necessary for the research. Interviews with nineteen (19) officials were conducted. Good progress has been made with the implementation of the PFMA. All those officials that were interviewed displayed sensitivity for the responsible management of public funds. A lack of internal control measures was identified in almost all audit reports. The absence of a risk management plan and a functional internal audit unit is hampering the realisation of the objectives of the PFMA. With health care service delivery and black economic empowerment being topical issues in SA, this research endeavours to make recommendations that could assist the Western Cape government with the realisation of the intended objectives of better health care services delivery by public hospitals, transformation of the economy, equity and empowerment of the disadvantaged through SCM processes and eventually to secure “a better life for all”.

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